Sure, per Taylor Rule, FED could cut rates with lower inflation BUT, question is, will inflation actually come down per expectations (less than 3s)? Massive gov spending plus other legislation points higher. HIGHER FOR LONGER. Prematurely cut & long end could blow out.
Even IF they rate cut 100bps (per expectations), they are still 400bps+ higher when people, businesses, etc refinance or get a loan. HIGHER cost of money hasn’t been fully felt yet. Therefore, this won’t do much! HIGHER FOR LONGER.
Inflation began rising in 2021, and the FED was very slow in raising interest rates and tightening monetary policy.Per the Taylor rule, the FFR should have been nearly 10% by the end of 2021, while the Fed kept the rate near zero. Policy mistake?
$SPY $SPX indexes have gone nowhere. Lots of action in between though. The indexes are pinned with vol compression at center. Banks/institutions supplying vol to markets. Structured products with bonds plus deriavtives with yield stacking.Always about Supply & Demand.
A chart tells a millions stories. End of 40 yr bond bull market?!Have we entered a secularly inflationary period with Higher for Longer?Massive DEBT rising. Over $34T + interest exp over $1T.It is always a future burden on the people. Is the GDP bloat from government
A chart tells a millions stories. Read More »
“Inflation is like alcoholism. The GOOD effects come FIRST and the BAD effects come LATER.” “That’s why there is a strong temptation to do too much.” “When you stop, the bad effects come first!” Milton Friedman “Free To Choose”
Real Estate News Same pattern: Home Sales DOWN, Home Prices UP RE Market is very SLOW. Could a recession ie job losses or higher vacancies trigger an influx of inventory and forced sales to LOWER prices? Stay tuned for 2024!
YTD 2023 vs 2022 Market – what a difference! 2023 YTD Top 3: $SMH SEMI, $IGV SOFTWARE $ITB HOMEBUILDERSWORST: Clean Energy!vs2022 YTD Tops: $XOP $OIH OIL OIL OIL! Sector rotation. Market does what *most* don’t anticipate. But where are the UTEs? Defensive worst this
YTD 2023 vs 2022 Market – what a difference! Read More »
The “disinformation specialists” are claiming a “soft landing” but we know:1. Inflation is embedded2. Prices are elevated & many increasing3. Debt is rising significantly in public & private sectors4. Purchasing power DECLINING
The “disinformation specialists” are claiming a “soft landing” but we know: Read More »
From Industrial Revolution to beginning of WW2, we had deflation as productivity & output increased & brought DOWN prices. Now with current revolutions – AI, IOT, Blockchain, BITCOIN. Expectations are similar. Where is that capture? Is it being hidden from the people & flowing
